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Incorporating in Delaware: Advantages

The benefits of a company registration in Delaware with Coddan: limited liability companies and limited liability partnerships (LLP) are attractive because they give members the same protection as that enjoyed by a corporation, while also offering a number of tax advantages and business benefits too. Unlike other business structures, an LLC is a corporate entity that is independent and takes responsibility for any debts, instead of its members having to shoulder this liability. Despite this important difference, however, an LLC is still able to function as if it was a conventional private corporation. It can trade, re-sell, and hold shares and other interests in separate companies or corporations. It can sign contracts, but its members' decreased liability means their personal assets are protected should any debts be incurred. We, we have wide range of LLC formation packages, & we can help you with the LLC registration in Delaware within 24 hours!

£175.00

ANNUAL FEES FROM £117.00

1
option

This stock corporation formation package exclusively for customers, who are requiring register a corporation with a prestige legal address in Wilmington & registered agent.

The following items are included into this Delaware corporation start-up offer:

    • The registered office address & the registered agent in the State of Delaware;
    • The certificate of formation with the by-laws;
    • The corporate membership' certificates & meeting of the board of directors.
£525.00

ANNUAL FEES FROM £467.00

2
option

This corporation start-up in Delaware package especially for customers, who are requiring registering a corporation with the registered agent, registered address in Delaware & with the nominee director.

This Delaware corporation incorporation offer includes everything in the first option, together with the advantages of:

  • The provision of the nominee director; the signed power of attorney;
  • The signed, undated resignation letter from nominee director;
  • The agreement for the provision of the nominee service.
£675.00

ANNUAL FEES FROM £617.00

3
option

This stock corporation incorporation in Delaware package is for customers, who are requiring registering a corporation with the registered agent, registered address in Delaware with the nominee director & nominee shareholder.

This stock corporation registration offer includes everything in the second option, plus the following enhancements:

  • The provision of a nominee shareholder service for one year;
  • The declaration of trust signed by a nominee shareholder;
  • The corporate bank account is available on request.
£835.00

ANNUAL FEES FROM £617.00

4
option

This is our most comprehensive corporate establishment in Delaware package with all company registration documents verified by a notary public & certified by the Apostille stamp.

This corporation setting-up in Delaware offer includes everything in the third formation option, plus:

  • The certification of all company documents including the power of attorney by a notary public & the final verification of documents by the Apostille;
  • Business bank account is available upon request; additional services are also available.
£175.00

ANNUAL FEES FROM £117.00

1
option

This LLC formation in Delaware package exclusively for customers, who are requiring register an LLC in the State of Delaware with a prestige legal address in Wilmington & registered agent for one year.

The following items are included into this USA LLC registration offer:

  • The registered office address & the registered agent in Delaware;
  • The certificate of formation with the an LLC agreement;
  • The LLC's membership' certificates & meeting of the board of members.
£425.00

ANNUAL FEES FROM £367.00

2
option

This LLC registration in Delaware package especially for customers, who are requiring registering an LLC with the registered agent & registered address in Delaware with the UK based nominee member.

This Delaware LLC incorporation offer includes everything in the first option, together with the advantages of:

  • The provision of the UK nominee member; the signed power of attorney;
  • The signed, undated resignation letter from nominee member;
  • The agreement for the provision of the nominee service.
£525.00

ANNUAL FEES FROM £467.00

3
option

This LLC incorporation in Delaware package is for customers, who are requiring registering an LLC with the registered agent & registered address in Delaware with the offshore nominee member.

This Delaware limited liability company start-up offer includes everything in the first option, together with the advantages of:

  • The provision of the offshore nominee member; the signed power of attorney;
  • The signed, undated resignation letter from nominee member;
  • The agreement for the provision of the nominee service.
£585.00

ANNUAL FEES FROM £367.00

4
option

This is our most comprehensive LLC establishment in Delaware package with all LLC company registration documents verified by a notary public & certified by the Apostille stamp.

This LLC setting-up in Delaware offer includes everything in the second LLC formation option, plus:

  • The certification of all LLC company documents including the power of attorney by a notary public & the final verification of LLC documents by the Apostille;
  • Business account is available upon request; additional services are also available.

Form a limited liability company in Delaware: at Coddan Ltd the team has the necessary expertise not only to incorporate your LLC in Delaware, but also to ensure you receive a service that will serve you and your interests in the longer term for the benefit of your clients and your business. With Coddan Ltd it is simple to register an LLC in Delaware. Only one person is needed to form an LLC in the State of Delaware. If you require registration of an LLC in Wilmington, we can help with all your needs by providing business service address for your LLC in the capital city of the State of Delaware, and certify LLC documents by apostille.

Establish an LLC in Delaware online: because a limited liability company is liable for the actions of each member, unlike general partnerships or limited partnerships, it isn't possible for the individual members to be held jointly or individually liable for each other's actions. This is a good way for a business to be structured where one partner, for example, is not actively involved in the day-to-day running of the operation. The LLC structure is suitable for a wide range of business but is particularly popular with building firms, property investment funds, professional service companies, and private equity management businesses. The big difference between an LLC and a corporation in Delaware is its informal organisation and consequent flexibility. However, like a private corporation, an LLC can still borrow against its assets and obtain a credit rating. The only way an LLC can cease to exist is when it is wound up formally, but the membership can change at any time with individual members free to leave as and when they require.

Incorporating in Delaware: Advantages and Disadvantages. Why Incorporate in Delaware?

Advantages and Disadvantages of Forming a Delaware Company

LLC registration or setting up a corporation in Delaware: when you register as an LLC, you receive the same benefits as a limited company, as well as a host of other business and tax advantages. As an LLC, your business is able to trade, hold shares and re-sell, but members have minimised liability for debts, so they increase the protection of their personal assets. LLC registration in Delaware: an LLC is a suitable structure for a variety of businesses - from building companies to professional services - particularly those where one member isn't actively involved on a daily basis. It is a flexible option with informal organisation, where members can leave as and when they need to. If you need an assistance with LLC registration in the State of Delaware, you can also speak to our business advisors between 9.30am-6.00pm Monday to Friday by telephoning + (0) 207.935.5171 or + (0) 330.808.0089 (national rates).

Advantages to Register Your Business in Delaware: LLC Advantages, Benefits to Incorporate in Delaware

Advantages to Register Your Business in Delaware: LLC Advantages, Benefits to Incorporate in Delaware

Foreign businesses seeking to enter or expand in the American marketplace can use their location in Delaware to accomplish their objectives. Delaware's strategic location permits easy access to the United States marketplace, the largest in the world. International business can easily incorporate in the state through the Department of State, Division of Corporations. Citizens and residents of other countries may incorporate in the United States through the standard incorporation procedures set forth by each state.

The main benefit of incorporation is that your personal assets are protected from civil liability for acts of the corporation. Your company must have a physical place of business and agent for service in the state in which you incorporate. If you do not wish to open an actual office for your business, you can often use Coddan as your registered agent and registered office address provider in the State of Delaware.

Why incorporate in Delaware? One of the best reasons for incorporating, or forming a limited liability company, is to separate your personal assets from your company's assets. If you conduct business without using a corporation, or limited liability company, you place your assets at risk. Separating your personal property from your business property, and using a legal form such as a corporation, can help protect your personal property.

Incorporation of a corporation or formation of a limited liability company also allows you to take advantage of the statutory and judicial laws of Delaware, to help you plan how your business runs. Delaware is known as a business-friendly state and is a good choice if you intend to "go public". Delaware has many advantages, including very low incorporation and LLC formation fees, low annual franchise taxes, and no state corporate income tax for companies that operate outside Delaware.

Delaware maintains a separate "Chancery Court" specifically for business disputes, known for its well-established record of decisions and speed. Delaware's court system helps business owners spend more time running the business and less time in court. Delaware companies may need to qualify or register to do business in their local jurisdiction, requiring an additional fee to the state where the business is operated.

One person can incorporates in Delaware, one person can form an LLC in Delaware, one person can be the president, secretary, and the treasurer & sole director of a Delaware corporation, without disclosing the names of the officers in the certificate of incorporation. The director or directors are allowed to amend the by-laws of the corporation.

One person can be the owner and managing member of an LLC. Delaware has no minimum capital requirement to incorporate or form an LLC. Delaware corporations and LLCs can qualify to do business in all 50 states and foreign countries.

More than half a million business entities have their legal home in Delaware including more than 50% of all U.S. publicly-traded companies and 58% of the Fortune 500. The State of Delaware has adopted a clear, bipartisan policy to attract new business start-up and encourage the expansion of existing operations. Key tax features, which now make Delaware more competitive, include: no state or local general sales tax, no personal property or inventory taxes.

Real property taxes are among the lowest in the country. Corporate income tax credits and reduction of gross receipts taxes for new and expanded businesses. Additional tax credits on corporate income and reduction of gross receipt taxes for new and expanding businesses locating in 30 targeted census tracts. Property tax relief for new construction and improvements of existing property. The exemption of certain investment and holding companies from corporate income tax.

The adherence of the State tax structure to the federal definition of corporate net income so that companies may take full advantage of any federal tax law change, such as more rapid depreciation of newly purchased assets. Two approved foreign trade zones will allow the deferment of import taxes. Public Utility Tax rebates of 50% on increased consumption for qualifying industries, and reduced rate for manufacturers and agricultural processors. Accelerated experience ratings for new employers.

State of Delaware Advantages: Start or Run a Business in Delaware

State of Delaware Advantages: Start or Run a Business in Delaware

One of the best reasons for registering a corporation, or forming a limited liability company (LLC), is to separate your personal assets from your company's assets. Whether you are beginning a brand new business, expanding an existing enterprise or simply planning to create a sideline business to supplement earnings from your salaried job, you need to consider how best to legally organize your undertaking.

These days you have a number of choices, including organizing as a sole proprietorship, partnership, limited liability company or corporation. If you conduct business without using a Delaware corporation, or limited liability company, you place your assets at risk. Separating your personal property from your business property, and using a legal form such as a corporation, can help protect your personal property.

A corporation is a separate tax entity from its owners. This means you can use your corporation to shelter business income instead of having to pay individual income taxes on all business profits each year. (For most corporations, the IRS allows you to accumulate up to $250,000 of earnings in the business, no questions asked.) Of course, you have to pay corporate income taxes on money left in the corporation, but because initial corporate tax rates are lower than the individual tax rates most business owners pay, you may reap substantial overall tax savings.

Corporate capital incentives: there is nothing better for attracting and motivating talented employees than sharing a piece of the ownership pie with them. The corporation easily accommodates employee capital participation through its ability to provide stock option, bonus and purchase plans. Corporations are also the preferred vehicle for raising private and public startup and expansion capital through the sale of stock to investors.

Corporate activity structure: the corporate form has a number of built-in ownership and activity layers - made up of shareholders, directors and officers - that allow a number of people to sensibly participate in its operations. This built-in division of activity and authority becomes important as the corporation becomes larger and needs to look beyond the founders to find people to help manage and fund the enterprise. The corporate form is designed to allow you to set up and make changes to these activity layers with standard paperwork and procedures - by electing new members to the board, appointing new officers and issuing stock to new investors.

Forming a corporation is an important, and sometimes exhausting, task. Typically, after the new entity is established and the initial shares sold to stockholders, the owners take a deep breath and get back to doing what they do best - running the day-to-day business operations. As a result, the owners often put off dealing with the many tasks necessary to properly run their new corporate entity. Leaving the care and feeding of your corporate legal entity undone is foolhardy.

Failure to properly document and support important tax decisions and elections can result in a loss of crucial tax benefits. Even worse, the fact that you have ignored your own corporate existence may result in its being similarly disregarded by the courts, with the risk that you may be held personally liable for corporate debts. And, of course, as time passes and memories fade, the reasons for approval of important corporate decisions, and the extent of each director's or shareholder's participation in approval of these decisions, may be forgotten.

This often leads to controversy and dissension, even in the ranks of a closely held corporation. The use of written minutes, resolutions and written consents, which record all-important corporate decisions and the votes taken to approve them, helps defuse these potential blowups. Or, to put all of this more positively, your first and best line of defense against losing the protection of your corporate status while helping to ensure continued harmony among your directors and shareholders is to document important corporate decisions by preparing and maintaining adequate corporate records.

Delaware incorporation or formation of an LLC also allows you to take advantage of the statutory and judicial laws of Delaware, to help you plan how your business runs. An example: Delaware Law allows for a version of the limited liability company often called a serial LLC. An LLC is normally very simple to create. The major difference between an LLC and a sole proprietorship or a partnership is the limitation of liability an LLC brings to you. But say that you wanted to conduct more than one type of business, and you didn't want to create a separate corporation or limited liability company for each.

The serial LLC allows different lines of business to be treated separately from each other from a liability standpoint. So, for example, an LLC that owns several apartment buildings may insulate the LLC from liability for each individual building, if the operating agreement allows for it, and the operating agreement is followed. For more information take a look at the Limited Liability Company Act of the Delaware Code (especially, Title 6, Section 18-215; series of members, managers or ;imited liability company interests).

We can incorporate or register a Delaware limited lability company (an LLC), as well as a limited partnership (LP) or a limited liability partnership (LLP).

Forming an LLC: the limited liability company or LLC is not a partnership or a corporation. An LLC is a distinct type of business that offers an alternative to partnerships and corporations, by combining the corporate advantages of limited liability with the partnership advantage of pass-through taxation. Limited liability companies, or LLCs, are becoming more and more popular, and it's easy to see why.

They combine the personal liability protection of a corporation with the tax benefits and simplicity of a partnership. Similar to the corporation, an LLC is recognized as a separate legal entity from its "members." Thus, an LLC can own property, commit itself to contractual obligations, and even commit crimes. In addition, they're more flexible and require less on-going paperwork than corporations.

The management of an LLC can be by members, in which case the management is much like that of a partnership. If the management of an LLC is by managers, then the management structure closely resembles a corporation.

We can help you quickly and easily set up a new LLC, or convert an existing business into an LLC. Filling out the Questionnaire is free. There is no time limit. At the end, you may decide whether or not you wish to purchase. Let Coddan help you with your LLC formation and any other legal procedures you may need. We make the process of incorporating as simple as possible so that you can take care of more important matters. Have more questions? Ready to get started? Please call: 0207 935 5171 or 0330 808 0089 so that we may help you. Referrals and repeat customers generate most of our business, we are more than just a filing service; we develop relationships with clients to help make them successful and keep them returning.

Advantages to Incorporate a Company in Delaware: Relevant Information for Starting an LLC in Delaware

Advantages to Incorporate a Company in Delaware: Relevant Information for Starting an LLC in Delaware

Title of filing: certificate of formation. Delaware company name requirements: the official name must contain the words "Limited Liability Company" or the abbreviation "LLC."

Organizer requirements: a limited liability company may be organized by one person. The organizer need not be a natural person, nor a member.

Certificate of formation requirements: the certificates of formation must contain the following: (1) name of company, (2) duration of company, if less than perpetual, (3) the registered agent name and registered office address, and (4) any additional matters. Past and future contributions and the limited liability company's power to avoid dissolution need not be stated.

Annual report requirement: yes, to Department of State.

Publication requirement: no.

Effective date of limited liability company organization: on the date of official approval of certificate of formation, the company becomes a legal entity and the members are shielded from personal liability.

Membership requirements: minimum number of members required is one. The member may be a natural person or a business entity.

Transferability of interest: unless provided otherwise in the limited liability company agreement, there is no free transferability of a member's limited liability company interests. Transfers of interests must be approved by unanimous vote of all members. (Section 18-702(a)).

Continuity of company: unless provided otherwise in the certificate of formation or limited liability company agreement, a member's withdrawal has no effect on the continuity of the lLimited liability company.

Management requirements: unless provided otherwise in the certificate of formation or limited liability company agreement, a limited liability company is managed by its members.

Operating agreement requirements: Delaware law refers to operating agreements as "limited liability company agreements" and they govern the rights, duties, and obligations of the members. They must be in writing.

Records requirements: the limited liability company must maintain copies of the following records at the company's registered office: (1) certificate of formation, (2) any amendments, (3) a current list of all members and managers (if any) and their addresses, (4) limited liability company agreement, (5) financial statements, and (6) federal, state, and local tax returns.

Liability shield: the members and managers of the limited liability company are expressly shielded from liability for debts, obligations and liability of the company by the statute.

Default rules: the following are default rules which are in effect, unless otherwise provided for in the limited liability company certificate of formation or limited liability company agreement: (1) voting rights of members are based on the percentage of profit interest of the member, (2) operating distributions are based on adjusted contributions of the members, and (3) profits and losses are based on contributions of members.

State classification: limited liability companies are classified in the same manner as they are for federal income tax purposes. State level taxation is based on the federal taxation entity classification.

Federal taxation: multiple member limited liability companies are treated as partnerships for federal tax purposes. Single member limited liability companies are reported on the owner's federal tax return as a disregarded entity, in effect treated as a sole proprietorship. (Federal Internal Revenue Code Section 701).

Starting Business in Delaware: Relevant Information for Incorporating a Company in Delaware

Delaware corporate name endings: the corporate name ending must contain the word "Association," "Company," Corporation," "Club," "Foundation," "Fund," "Incorporated," "Institute," "Society," "Union," "Syndicate," "Limited," or the abbreviation "Co.," "Corp.," "Inc.," "Ltd.," or words or abbreviations of like import in other languages. The name must be distinguishable from the names of other corporations organized, reserved or registered as a foreign corporation under the laws of Delaware. Use of word "Trust" is prohibited except for corporations under supervision of the Bank Commissioner.

Delaware corporation requirements: minimum number of directors is one or more.

Residence requirements: no provision.

Age requirements: none.

Directors are not required to be listed in the articles of incorporation.

Officer information: officers are not required to be listed in the articles of incorporation.

Stock information: an increase in shares or par value does affect initial filing fees.

Delaware corporate records: a stock ledger and basic corporate records must be kept at the principal office of the corporation.

Delaware taxes and fees &a,p; the annual statements: the annual statements for corporations are sent out to the registered agent in December and January. The payment is due by March 1st. The franchise tax is based on the number of shares and the par value, and if the number of shares is above 3000 the annual fee may increase. The annual statements for LLCs are sent out to the registered agent in March and April.

Income tax: the income tax rate for corporations actually located in Delaware is: 8.7%.

S Corporation: S Corporation status is recognized by the State of Delaware. A separate state election from the federal election is not required.

License requirements: Delaware requires some businesses to obtain a license and pay a fee if you are operating in the state. Please check with the state to make sure your business is complying with the license requirements for your particular profession.

Start-Up a Business in Delaware: an Introduction to the State of Delaware

Delaware is centered on the eastern seaboard of the United States, approximately midway between New York City to the north and Washington D.C., to the south. Lying in the heart of the eastern megalopolis, the State is bordered on the north by Pennsylvania and on the west and south by Maryland. To the east, Delaware is separated from New Jersey by the Delaware Bay and enjoys a scenic Atlantic Ocean coast. This location provides unusually good market access.

With a land area of only 1,982 square miles (5,133 sq. km), State of Delaware ranks 49th in land area among the 50 states. Delaware is the fourth least populated state with 706,000 residents. Two-thirds of the State's population resides in New Castle County, the northernmost of the State's three counties. Kent County and Sussex County each has a population of approximately 110,000 residents. All of the cities and towns in the State are independent, incorporated municipalities. There are three major cities in the State: Wilmington, with a population of 72,000; Dover, the State capital, with a population of 28,000; and Newark, the site of the University of Delaware, with 25,000 residents.

Delaware's central location affords rapid access to the major metropolitan areas of the northeast and Mid-Atlantic United States. Nearly one-third of the population of the United States lives within this eastern megalopolis. Interstate and other major highways and frequent passenger rail service provide easy transportation between Wilmington and New York (1 hour, 50 minutes), Washington D.C. (1 hour, 15 minutes), Philadelphia (30 minutes) and Baltimore (45 minutes). Within a 350-mile (550-km) radius of central Delaware lies every major population center from Boston in the north to Raleigh, North Carolina in the south and Cleveland, Ohio in the west.

Delaware is also well served by air transportation. Delaware's network of public and private airports can readily accommodate commercial and corporate aircraft. Philadelphia International Airport, a major international passenger airport, is 30 minutes from downtown Wilmington. Baltimore and Washington International Airport is approximately an hour away by rail. Marine freight transport is served by the Port of Wilmington. As the first inland port on the Delaware River, Wilmington's containerized port is only 65 miles (100 km) from Atlantic shipping lanes. Its deep-water port facilities include modern, economic off-loading and storage facilities. The Port currently handles 4.5 million tons of waterborne cargo annually, including bananas, import and export vehicles, frozen meat and seafood, frozen juice concentrates, fresh fruits, lumber, steel, Kraft linerboard, gypsum, salt, urea, petrolcoke, various bulk ores and minerals and liquid bulk such as petroleum products.

The Port of Wilmington offers potential savings over neighboring ports because of reduced vessel transit time to and from the Atlantic Ocean, high labor productivity and economical handling rates. The Port has ready access to Interstate 495, connecting it to major east-west and north-south interstate arteries. Rail access to the Port is available by Conrail and the Chessie System, with railcar loading docks located next to every terminal warehouse.

Delaware is also served by the mainlines of the Conrail and CSX railroads. Conrail's north-south route through Delaware facilitates fast through service to the vital northeast corridor and connections with CSX. Most of Delaware's plant sites are adjacent to rail lines or have rail sidings at the plant location. Rail sidings are easily obtainable in Delaware, as compared to other states in the region, due to the lack of rail congestion. In addition to major carriers, Delaware is also served by a number of short-line railroads.

Led by the chemical and automotive industries, manufacturing is the largest source of State income, closely followed by financial services that, with other elements of our service economy, are increasingly important. These industries figure most prominently in the industrialized and commercial northern third of the State. In the southern two-thirds of the State, agriculture is a more vital part of the economy. The poultry industry, corn, soybeans and diary products contribute significantly to farm income. One-half of the State's land acreage is used for farming.

Delaware actively seeks and encourages enterprise and investment. To this end, Delaware has evolved the most modern and flexible business organization laws in the United States, has adopted modern banking and consumer credit laws and has reduced personal income taxes and established a nationwide reputation for innovative tax structure.

Through the Delaware Development Corporation, Delaware became the second state to obtain certification under the U. S. Small Business Administration's Section 504 loan program. This program offers long-term, fixed-asset financing at fixed rates to the growing small firm. In addition to land, building and equipment, many of the costs associated with construction, such as interim financing costs and architectural drawings, that are usually considered "out-of- pocket" expenses may be included in a Section 504 loan package.

To be eligible, a small business must be a for-profit enterprise with a net worth of less than $6 million and average net profits of less than $2 million for the past two years. In addition, the project must create one new job for approximately every $35,000 of Small Business Administration funding.

The Section 504 program can provide long-term financing for projects totalling $120,000 to $2,500,000 for the acquisition of land and buildings, the construction, expansion or renovation of facilities, including leasehold improvements, and the purchase of machinery and equipment Funds are not available for working capital, inventory, debt consolidation or debt repayments. The applicant must be the user of the facilities.

A Section 504 fixed-asset financing involves a mixture of funding from the small business, a private sector lender (e.g. bank, savings and loan association or insurance company), and the Delaware Development Corporation. A typical project would involve 50% funding from the private lender, 40% from the Delaware Development Corporation up to a maximum of $750,000 in urban areas and $1,000,000 in rural areas, and 10% from the small business. For a start-up small business, the business may need to contribute 20% to 25% in equity to the project.

Delaware has one of the highest concentrations of patents and of scientists and engineers in the United States. High-risk equity seed capital is often necessary to enable start-up companies to commercialize new technologies and create jobs. Recognizing this, Delaware is a limited partner in a venture capital fund known as Delaware Venture Partners. Due to a unique, cooperative alliance of two fund managers to oversee the program, Delaware Venture Partners has the ability to fund seed-stage, early-stage and later-stage companies. The investment focus will typically be in the following areas: computer-related, high technology, biotechnology, medical, and communication, environmental and manufacturing. Investments can range from $100,000 for seed-stage companies up to $2,000,000 for later-stage companies.

The Delaware Innovation Fund seeks to provide limited early-stage funding for technology or high-growth potential enterprises such as biotechnology, advanced materials, software and telecommunications. The Fund offers demonstration funding of $10,000 to $25,000 to establish patents and proof of concept, and $25,000 to $150,000 for commercialization. The Fund also acts as a resource for assistance with business and strategic plans for eligible enterprises.

The Delaware Access Program is designed to give banks a flexible and non-bureaucratic tool to make business loans that are somewhat riskier than conventional bank loans, in a manner consistent with safety and soundness. The program is designed to use a small amount of public resources to generate a large amount of private bank financing, thus providing access to bank financing for many Delaware businesses that otherwise might not be able to obtain such access.

The Delaware Access Program, based on a risk-pooling concept, is fundamentally different from a traditional insurance or guarantee program, such as the federal Small Business Administration Section 7 (a) program, which guarantees a percentage of a loan on a loan-by-loan basis. When a bank makes a loan under the Delaware Access Program, the borrower pays a one-time premium charge, which is matched by a bank premium payment. The Delaware Economic Development Authority then matches the combined total of the borrower's payment and the bank's payment. The borrower's premium payment is one of the terms of the loan to be worked out as part of the private transaction between the bank and the borrower. The program sets minimum and maximum limits for the borrower's payment. At a minimum, it must be at least 1 1/2% of the loan amount. The maximum is 3 1/2%. The premium payment, and other up-front expenses, may be financed as part of the loan.

The Delaware Economic Development Office also assists small businesses in seeking loans guaranteed by the U. S. Small Business Administration under the Section 7 (a) business loan program. The Small Business Administration generally guarantees 90% of the loan from a local financial institution with a maximum guarantee of $750,000. Guaranteed loans are utilized by firms with loan needs that exceed the usual banking criteria.

Financing can be obtained for both working capital and fixed assets. The Small Business Administration may require one-third equity when evaluating loan applications from new companies. Equity requirements for ongoing businesses vary. Financial institutions tend to restrict the financing to projects exceeding $50,000, and the interest rate and term are negotiated between the borrower and the lender within limits prescribed by the Small Business Administration.

The Small Business Administration also operates several other special programs. Builders operating under contract may apply for the Small Business Administration's guaranty program for lines of credit and surety bond guarantees. Companies with highly seasonal sales may obtain seasonal lines of credit. The Small Business Administration also offers loan guarantees for pollution control financing and loans for support of export trade.

The Economic Development Loan Program assists Delaware small businesses with no more than 500 employees to finance projects when 100% financing cannot be obtained through a bank. Financing can be provided for fixed assets as well as working capital. Funds are not available for debt consolidation or debt repayments.

The program requires 70% bank financing. The remaining 30% is financed through the program up to a maximum of $450,000. In most cases the interest rate loaned through the Economic Development Loan Program is 60% of the prime lending interest rate.

The Delaware Technical Innovation Program encourages Delaware businesses to participate in the federal Small Business Innovation Research (SBIR) grant program. The SBIR program requires that 1.25% of all federal research dollars be made available to small businesses.

Under the SBIR program, during Phase I, small businesses submit detailed research and development proposals to participating federal agencies. The federal agencies evaluate technical merit and feasibility. Phase I awardees are granted up to $100,000 by the federal government. A Phase I awardees located in Delaware or relocating to Delaware is eligible for a grant under the Delaware Technical Innovation Program up to $50,000 so long as the company has submitted a proposal to the federal agency in order to qualify for a Phase II award (i.e. pursuit of development of the Phase I concept) and can demonstrate that the research to be conducted will benefit the Delaware economy.

Delaware is a part of the Mid-Atlantic Regional Trade Council that is composed of the states of Delaware, Pennsylvania, Maryland and Virginia. The Council, along with certain banks, can assist exporters to submit applications for export working-capital financing through the Export-Import Bank of the United States. These organizations can also help facilitate processing of applications for other Export-Import Bank programs, such as direct and intermediary loans and loan guarantees.